Opendoor falls double digits as one-way flows frenzy suddenly reverses

The thing about a flow-driven surge in a stock is that the fires need to be stoked by continued flows from motivated buyers.

Opendoor Technologies had a near seamless run of just that for about a week, but it wasn’t really there as much today.

The stock fell 10% on the session, breaking a six-session streak where shares rose at least 10% every day and rose more than 30% in half of those days.

Volumes were down — granted, it would’ve been extremely hard to build on Monday’s insane amount of trading — as were options volumes traded.

But the nature of the volume is also instructive.

On Monday, trades of 521 million shares took place on the ask (the lowest price a seller is willing to accept, pointing to a motivated buyer) versus volumes of 480 million on the bid. On Tuesday, volumes on the bid side outnumbered those on the ask, per Bloomberg data.

The options flows were still overwhelmingly tilted toward calls — calls outnumbered puts by about 1.9:1 today versus 2:1 on Monday — but the most active option traded on Opendoor was a put with a strike price of $2.50 that expires on Friday.

When flows are more of the story than fundamentals, it’s this relatively boring tallying of motivated buying versus motivating selling that can give a clue as to how much momentum a move has and whether it’s at risk of reversing.